No, you are not doing anything wrong but unfortunately, that's the way sqoop works. Every time you make any changes in the table and then do incremental append then the new data is saved in a new file.
That's how batch processing works in all hadoop technologies.
If you want to create additional part files with only new records, then you may have to use one more parameter --last-value in the sqoop command. Please refer below command.
Command: sqoop import --connect jdbc:mysql://mysqldb.edu.cloudlab.com/MonikaDb --username=labuser --password=edureka -m 1 --table employee -target-dir "/user/edureka_425270/Monika_Test1" --incremental append --check-column id --last-value 2 4